ProSiebenSat.1 ‘not in discussion’ with Mediaset or CMI

ProSiebenSat.1 is not involved in any discussions with shareholders Mediaset or Czech Media Invest (CMI) over strategy or any possible combination of businesses, according to CEO Rainer Beaujean, answering an analyst question after the German broadcaster posted a 25% drop in revenues for Q2.

Beaujean said that there were “no further discussions currently about strategy or whatever with Mediaset and CMI”.

Mediaset and the Czech group have separately acquired significant stakes in ProSiebenSat.1, as has private equity outfit KKR.

Mediaset purchased an additional 4.1% of ProSiebenSat.1 in April taking its stake up to 24.9% of the voting rights in ProSiebenSat.1, just shy of the 25% threshold that meets the local regulatory regime’s definition of market concentration.

CMI, backed by Czech entrepreneur Daniel Kretinsky, a company seen as an ally of Mediaset, has also progressively upped its stake in ProSiebenSat.1

KKR took a 5.2% stake in May.

Beaujean said that ProSiebenSat.1’s cash position was strong, and that the group had “only lost €60 million in cash from Q1 to Q2”, adding that shareholders CMI and KKR supported the group’s focus on cash flow.

Following the drop in Q2 revenues, Beaujean said he expected ad sales to decline by “slightly less than 20” in July with further improvements expected in August. “We are moving in the right direction,” he said.

ProSiebenSat.1 saw revenues slide by a quarter to €709 million as the COVID-19 crisis hit the company’s top line. EBITDA plummeted from €213 million to €23 million for the period, and adjusted net income also dropped.

Red Arrow Studios’ revenues dropped by 31% to €102 million in Q2

Despite the drop in revenue, analysts at Berenberg said they saw “chinks of light” in the broadcaster’s Q2 performance.

Berenberg said that “Q2 2020 revenues were in line with consensus, with EBITDA well ahead” with a solid performance from the group’s online and matchmaking businesses.

Berenberg said that the broadcaster was “worth more than the share price suggests”. However, it said that the recent delay to the closing of the Media for Europe transaction by Mediaset “must push back any chance of the Italian group attempting consolidation of the German business, as had been hoped for by some investors”.

Mediaset’s plans for MediaForEurope, the Dutch-registered vehicle for a merged Mediaset and Mediaset España that was also expected to hold the group’s stake in ProSiebenSat.1, has been put on indefinite hold after a legal victory by Vivendi, which is battling to stop the merger, in Spain.